Look Inside

Also by these Authors

The Future of Europe

Overview

Unless Europe takes action soon, its further economic and political decline is almost inevitable, economists Alberto Alesina and Francesco Giavazzi write in this provocative book. Without comprehensive reform, continental Western Europe's overprotected, overregulated economies will continue to slow—and its political influence will become negligible. This doesn't mean that Italy, Germany, France, and other now-prosperous countries will become poor; their standard of living will remain comfortable. But they will become largely irrelevant on the world scene. In The Future of Europe, Alesina and Giavazzi (themselves Europeans) outline the steps that Europe must take to prevent its economic and political eclipse.

Europe, the authors say, has much to learn from the market liberalism of America. Europeans work less and vacation more than Americans; they value job stability and security above all. Americans, Alesina and Giavazzi argue, work harder and longer and are more willing to endure the ups and downs of a market economy. Europeans prize their welfare states; Americans abhor government spending. America is a melting pot; European countries—witness the November 2005 unrest in France—have trouble absorbing their immigrant populations. If Europe is to arrest its decline, Alesina and Giavazzi warn, it needs to adopt something closer to the American free-market model for dealing with these issues.

Alesina and Giavazzi's prescriptions for how Europe should handle worker productivity, labor market regulation, globalization, support for higher education and technology research, fiscal policy, and its multiethnic societies are sure to stir controversy, as will their eye-opening view of the European Union and the euro. But their wake-up call will ring loud and clear for anyone concerned about the future of Europe and the global economy.

About the Authors

Alberto Alesina is Nathaniel Ropes Professor of Political Economics at Harvard University. He is the coauthor (with Enrico Spolaore) of The Size of Nations (MIT Press, 2003).

Francesco Giavazzi is Professor of Economics at Bocconi University and Visiting Professor at MIT. He is the coauthor (with Alberto Giovannini) of Limiting Exchange Rate Flexibility: The European Monetary System (MIT Press, 1989).

Reviews

“As the new Congress begins work, it should peruse a recently published book, The Future of Europe: Reform or Decline, by two Italian economists, Harvard's Alberto Alesina and Bocconi University's Francesco Giavazzi. They explain what went wrong in Europe in particular in France, Germany, Italy, and Spain and how Europe can continue as a major economic power.”—Diana Furchtgott-Roth, New York Sun

“This book could have been a diatribe, but is saved from that by the intelligence of the authors' arguments and policy recommendations. A must read for those interested in the European economy.”—Choice

Endorsements

“Like all market-based economies, the transition countries are now subject to financial instability. This timely and important book uncovers the distinctive features of transition that give rise to financial crises in emerging market countries.”—Charles Wyplosz, Professor of Economics, Graduate Institute of International Studies, Geneva